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Archives of Business Research – Vol. 10, No. 6
Publication Date: June 25, 2022
DOI:10.14738/abr.106.11911. Gjaowe, J., & Ako Tiku, L. (2022). Mobile Money and Financial Inclusion of Rural Women in the Informal Sector: A Case of Users of
Orange Money in Yagoua. Archives of Business Research, 10(6). 115-131.
Services for Science and Education – United Kingdom
Mobile Money and Financial Inclusion of Rural Women in the
Informal Sector: A Case of Users of Orange Money in Yagoua
Joseph DJAOWE
Saint Jérôme Management Sciences and Business School
Institut Universitaire Catholique Saint Jérôme de Douala, Cameroon.
Leonel AKO TIKU
Ph.D. Candidate, University of Maroua, Cameroon
ABSTRACT
The purpose of this article is to assess the influence of Mobile Money on the financial
inclusion of rural women in the informal sector. Women's access to financial
services is a key factor in economic growth and development. This work aims to
measure the impact of mobile finance, mobile wallet and mobile payment on the
financial inclusion of women. To this end, a questionnaire was administered to a
sample of 98 rural women working in the informal sector. Data from the surveys
were analyzed using SPSS software and subjected to the binary logistic regression
test. From this investigation, the following results emerge: (1) mobile finance
positively influences the financial education of rural women in the informal sector;
(2) the mobile wallet contributes to an increase in the income of rural women in the
informal sector and (3) mobile payment accelerates the access of rural women in
the informal sector of Yagoua to financial services. In order to further promote the
financial inclusion of rural women, moderately literate, formerly excluded from the
traditional financial system and working in the informal sector of Yagoua, it would
be wise to find ways and means to enable them to access the services of formal
financial institutions through Mobile Money.
Key words: Mobile money, rural women, financial inclusion, informal sector
INTRODUCTION
Africa is now the world’s second fastest growing region after Asia, with annual GDP growth
rates more than 5% over the last decade. Many countries, especially in sub Saharan Africa, have
achieved high growth rates over the past decade, and many aspire to structural transformation,
but the good performance has not turned into significant poverty reduction and shared
prosperity. It has yet to provide low-income households and other vulnerable groups, such as
women, enough opportunity to improve their living standards. One key component of inclusive
development is financial inclusion, an area in which Africa has been lagging over other
continents. This study seeks to provide various ways showing that the implementation of
Mobile Money network through Orange Money in the case study will enable economic relevance
and prominence amongst the female population of Yagoua1.
1 Yagoua is a council in Cameroon located in the Far North region, near the border with Chad (Bongor) which covers an
area of 950 km2. It is the capital of the division of Mayo-Danay.
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Archives of Business Research (ABR) Vol. 10, Issue 6, June-2022
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Financial inclusion is therefore vital to ensure that economic growth performance is inclusive
and sustained. Financial inclusion refers to all initiatives that make formal financial services
Available, Accessible and Affordable to all segments of the population. In Africa, insufficient
documentation is an important barrier for younger adults and women to open an account while
distance from a bank is a commonly cited barrier for adults living in rural areas. Bringing
financial services to rural clients is a major challenge on the financial inclusion agenda. Often
the main barrier to financial inclusion in rural areas is the great distances that rural households
must travel to reach a bank. The lack of infrastructure may explain why Africa has been at the
forefront of mobile financial services which is considered a bright spot in improving financial
inclusion.
The number of women entering the workforce in Africa has been substantially increasing over
the last decade while women-owned businesses are a growing share of all enterprises in many
African countries. Financial inclusion of women and girls can create gender equality by
empowering them and giving them financial autonomy. Savings accounts can provide women
and girls with a safe and formal platform to save their earnings for future investments in
business operations and build a credit history.
Lack of access to financial services reduces women’s ability to climb out of poverty; increases
their risk of falling into poverty; contributes to women’s marginalization to the informal sector;
and reduces their ability to fully engage in measurable and productive economic activities.
While women represent a larger share of the self-employed in developing countries and thus
are in greater need of access to formal financial services, they are less likely to secure bank
credit according to research by the World Bank. Women’s financial inclusion is an underused
source of growth that should be harnessed to achieve sustainable and inclusive development.
In addition to the economic benefits, financial inclusion of women has social benefits. Indeed,
research has shown that women use their earned income and savings more productively,
channeling a large share to children’s nutrition, clothing, health, and education (Burjorjee et al.,
2002).
Yet, according to Cameroon’s Telecommunications Regulations Agency, the mobile telephone
penetration rate in Cameroon rose from 9.8% to 71% between 2004 and 2014. This explosion
in mobile service usage has become an excellent opportunity to develop mobile banking
services that could help improve banking access in Cameroon. Though not without skeptics,
mobile money has been hailed for its role in fostering financial inclusion among the poor and
unbanked, as well as championed for bringing organizational cost and time savings, increasing
financial transparency, and reducing security risks.
Yet, until recently, in Africa and elsewhere, little was known about the reach of the financial
sector—the extent of financial inclusion and the degree to which disadvantaged groups such as
the poor, women, and youth are excluded from formal financial systems (Demirgüç-Kunt et al.,
2012)
The role women play as important economic agents is largely invisible by the fact that the
majority work in the informal sector where their contribution is not adequately quantified or
measured. Jerven (2013) argues in his book on the problem with African statistical data, the
‘unrecorded economy’ in Africa, to which women contribute significantly, continues to be
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Gjaowe, J., & Ako Tiku, L. (2022). Mobile Money and Financial Inclusion of Rural Women in the Informal Sector: A Case of Users of Orange Money in
Yagoua. Archives of Business Research, 10(6). 115-131.
URL: http://dx.doi.org/10.14738/abr.106.11911
undervalued and underappreciated because of the unavailability of reliable and credible data.
Despite the measures taken by the authority, that is, to ensure that the barriers to access
financial services by women be removed through the creation of banks, microfinances (Credit
du Sahel, Mutual communal Credit MC2 and La Régionale) and Money Transfer Agencies
(Express Union, Express Exchange and EMI Money) in this locality have no significant effect on
them. There is plenty of compelling evidence that women are a powerful driver of economic
growth. Women generally face a wide spectrum of financial challenges, many of which have
been documented in many studies. These include, but are not limited to, lower levels of
education and financial literacy, lower income levels, lack of tangible assets or collateral, legal
constraints, time and mobility constraints, socio-cultural constraints, inter-role conflicts from
juggling domestic and professional roles and a lack of market exposure (Demirgüç-Kunt et al.,
2013).
An estimated 12% of the adult population in SSA have a mobile money account compared to
only 2% worldwide (Demirgüç-Kunt et al. 2014). The mobile financial services are relatively
cheap, secure, reliable and accessible and have seen majority of the poor and low income
earners expand their financial platforms to include mobile banking, agency banking and other
forms of financial services. In particular, the wide-spread use of mobile phone technology has
opened new markets across SSA and has necessitated financial services to reach consumers in
remote areas where banking services is lacking.
The barriers that constrain women’s access to finance, compared to men’s, limit (by
approximately half) the poverty reducing, and growth promoting potential of finance and may
prove costly in terms of foregone development and potential macroeconomic gains (Narain &
Sushma, 2009). Differential treatment under law or customs may also constrain women to
enter contracts under their own name, including the opening of a bank account (IFC, 2011 and
World Bank, 2012). Most economically active women in Africa operate in the informal sector
(Chen, 2001). The lack of education, work experience, and financial literacy skill results in an
inability for women to “navigate the system”, which leaves them disadvantaged when it comes
to seeking finance (Hallward-Driemeier, 2011).
This study seeks to provide various ways showing that the implementation of Mobile Money
network through Orange Money in the case study will enable economic relevance and
prominence amongst the female population of Yagoua. In other words is question to evaluate
the influence of Mobile Money on the financial inclusion of rural women in the informal sector.
The remaining of the paper is organized as follows: we present a brief overview of the existing
literature in section 2; in section 3, we expose the methodological elements of empirical
analysis; in section 4, we present the preliminary statistical analyses of the data. The empirical
results and their comments are exposed in section 5. Finally, section 6 concludes the article.
LITERATURE REVIEW AND RESEARCH HYPOTHESES
The association of the word “Mobile finance” and “financial literacy” goes beyond the access to
a full suite of quality financial services (provided at affordable prices, in a convenient manner,
and with dignity for the clients) as assume. It adds that the services provided by a range of
private institutions (Mishi & Kapingura., 2012).